It's going to cost the University an additional $14 million dollars a year -- the University is already spending $116.8 million a year on undergraduate aid. That's a huge amount of money for a relatively cash-strapped institution like Cornell.

Why is this announcement so important? Because due to Cornell's financial position and more economically diverse student body, the announcement represents a much larger commitment of resources than some of Cornell's peers.

The university expects to spend $116.8 million of its own resources on undergraduate financial aid in 2007-08, 94 percent of which will be spent on grant aid. More than 60 percent of Cornell's undergraduates receive some form of financial aid. Cornell has a greater number and a higher percentage than most of its peers of Pell grant recipients -- students from families that have annual incomes below $45,000. For fall 2007, Cornell enrolled 1,799 Pell grant recipients, representing 13.3 percent of its undergraduate student body.

As David Harris so adequately put it:

Deputy Provost David Harris added: "Because Cornell's financial-aid population is larger than the entire undergraduate student bodies of a number of our fellow institutions, the challenge was especially significant here. This initiative will strengthen the economic diversity of our student body and, most importantly, free our students to pursue studies and careers that match their skills and interests, rather than those that ensure they will be able to repay their loans."

If you read between the lines, however, what's not clear is whether or not the University is actually adopting a "free tuition" policy as Dartmouth and Harvard have (Dartmouth for families under 75k, Harvard for families under 120k). I suspect that the no-loan policy actually still involves expectations that Cornell students will work during the year and the summer and contribute to the cost of their education. Which if you ask me, is a good thing.